Markets Back in the Winning Column…..
U.S. equities rebounded from a rut as of late, finishing the session with solid gains, led by the tech sector that fueled the recent declines after contributing to the historic five-month rally off of the March lows. The rebound came despite persistent U.S. political uncertainty, with the presidential election looming and a highly-anticipated new round of fiscal relief measures remaining questionable, while U.S.-China tensions continue to simmer and U.K. Brexit worries appear to be flaring up. On the equity front, Lululemon topped Q2 expectations but opted to not provide full-year guidance, LVMH abandoned its takeover agreement of Tiffany & Co, and Slack Technologies’ disappointing billings growth overshadowed its quarterly results. In economic news, job openings came in above estimates and mortgage applications increased. Treasury yields moved higher as bond prices lost ground and the U.S. dollar trimmed a recent bounce. Crude oil prices pared yesterday’s drop and gold was higher. Europe also somewhat recovered from yesterday’s drop to finish with widespread gains, while markets in Asia were sharply lower, following in the footsteps of the U.S markets’ tumble yesterday.
The Dow Jones Industrial Average jumped 440 points (1.6%) to 27,941, the S&P 500 Index advanced 67 points (2.0%) to 3,399, and the Nasdaq Composite increased 294 points (2.7%) to 11,142. In moderate volume, 867 million shares were traded on the NYSE and 3.5 billion shares changed hands on the NASDAQ. WTI crude oil gained $1.29 to $38.05 per barrel and wholesale gasoline was $0.02 higher at $1.10 per gallon. Elsewhere, the Bloomberg gold spot price was up $17.22 to $1,949.25 per ounce, and the Dollar Index—a comparison of the U.S. dollar to six major world currencies—moved 0.3% lower to 93.21.
Job openings increase more than expected, mortgage applications rise…..
The Labor Department’s Job Openings and Labor Turnover Survey (JOLTS), a measure of unmet demand for labor, showed 6.62 million jobs were available to be filled in July, versus the Bloomberg forecast calling for it to match June’s upwardly-revised 6.00 million figure. The report showed the hiring rate fell to 4.1% from June’s 5.1% rate and separations remained at June’s 3.6% pace.
The MBA Mortgage Application Index rose by 2.9% last week, following the prior week’s 2.0% decrease. The increase came as a 3.0% gain in the Refinance Index was accompanied by a 2.6% rise for the Purchase Index. The average 30-year mortgage rate dipped 1 basis point (bp) to 3.07%.
Treasuries dipped as the stock markets rebounded from a recent pullback, as the yield on the 2-year note was little changed at 0.14%, the yield on the 10-year note ticked 2 bps higher to 0.70%, and the 30-year bond rate rose 4 bps to 1.46%.
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